Nokia Eyes CDMA 450

Finnish vendor reported to be watching market 'very closely'

June 25, 2004

2 Min Read
Nokia Eyes CDMA 450

Nokia Corp. (NYSE: NOK) is reported to be keeping a close eye on the emerging CDMA 450 network market, suggesting the Finnish vendor hasn’t ruled out the possibility of a market entry.

“We are following developments in that frequency area very closely, and keep watching the market,” said Nokia’s executive VP of networks, Sari Baldauf, according to a Dow Jones Newswires report.

Deployed in frequency bands previously hosting analog Nordic Mobile Telephony (NMT) cellular systems, CDMA 450 belongs to the CDMA2000 family of technologies, but operates in the 450MHz spectrum. Signals yield a broader cell radius at 450 MHz than on networks running over 850-, 1800/1900-, or 2100-MHz systems, meaning up to 80 percent fewer base stations are required for a given deployment.

Carrier interest in the CDMA 450 market has ramped up in recent months following strong interest from Northern and Eastern European service providers (see CDMA 450 Flows Into Norway, CDMA 450 Seeps Into Europe, and CDMA 450 Czechs In).

Meanwhile, nearly all of Nokia’s vendor rivals have added CDMA 450 products to their portfolios. The likes of Huawei Technologies Co. Ltd., Nortel Networks Ltd. (NYSE/Toronto: NT), and Lucent Technologies Inc. (NYSE: LU) have announced European contract wins; while ZTE Corp., UTStarcom Inc. (Nasdaq: UTSI), and LM Ericsson (Nasdaq: ERICY) have demo'd their offerings (see Eurotel Picks Nortel, Lucent Scores in Moscow, UTStarcom's CDMA Play, and Ericsson Adds to CDMA Portfolio).

Any serious intent by Nokia to enter the CDMA 450 network business would certainly raise eyebrows in the infrastructure space. Nokia is traditionally associated with the European-backed GSM (Global System for Mobile communications) and UMTS (Universal Mobile Telecommunications Service) markets.

Despite earlier reports of a potential market entry via acquisition, to date the vendor has no presence in the CDMA network sector (see Nokia Mulls CDMA Move and Nokia's CDMA Shopping List).

Analysts play down the prospect of a surprise move.

“If Nokia were to get into the game it would be facing some stiff competition,” comments Peter Jarich of Current Analysis. “Without Ericsson, Nokia might have had a play for CDMA 450 launches in Europe, but it's too late for that now. As Ericsson has demonstrated, it takes a long time to build momentum as a new infrastructure player even with good equipment. The real play for Nokia would be on the CDMA 450 handset side, potentially boosting its CDMA aspirations.”

Nokia was unable to respond to Unstrung’s calls by press time.

— Justin Springham, Senior Editor, Europe, Unstrung

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